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Today’s leading asset managers are constantly self-evaluating their investment decisions by performing comprehensive analysis of their performance. Attribution analysis, also referred to as return attribution or performance attribution, is a valuable tool for evaluating a portfolio’s performance in comparison to a specific benchmark, asset segment, sector, or security. Whether investments performed well or poorly, asset managers want as much detail as possible about what worked, what did not, and why. Much can be learned by analyzing investment approaches that either outperform or lag against benchmarks and their peer groups to determine what decisions paid off in order to fine-tune an investment strategy and to better understand past performance.

When asset managers open for business the Tuesday after Memorial Day weekend 2024, the settlement period for most US and Canadian securities transactions will be a single day (T+1). Whether or not you’re worried about your firm’s ability to meet the May 28 date is likely dependent on the efficiency of your trade settlement operating model.

The SEC and its Canadian equivalent, the Canadian Capital Markets Association (CCMA) recently adopted a rule amendment shortening the settlement cycle of securities transactions to trade date plus one (T+1) effective May 27th/28th, 2024. Currently, settlements within these markets for applicable securities occur on T+2.

Asset managers must continuously adapt to changes in their operating environment. Whether it be market or regulatory driven changes, cost pressure, changing dynamics within their investment strategies, and the added complexity of new asset types, the common denominator that underlines everything an asset manager needs for success is their investment data.

With the high volume and complexity of investment products and asset types in the current volatile and uncertain market, many asset managers may be spending too much time on middle office functions, while missing opportunities to improve client relationships and focus more on core business decision-making in today’s constantly changing industry.

When outsourcing your middle office services it’s important that your provider can seamlessly interact and communicate with your data to guide it where it needs to go.